CONDITIONAL LOAN CONVERSION AGREEMENT

Exhibit 10.1

Execution Version

CONDITIONAL LOAN CONVERSION AGREEMENT

THIS CONDITIONAL LOAN CONVERSION AGREEMENT (this "Agreement") is entered into as

of November 16, 2007 by and between China Biopharmaceuticals Holdings Inc.

("CBH"), and RimAsia Capital Partners, L.P. ("RimAsia"). CBH and RimAsia

hereinafter collectively may be referred to as the "Parties" and each

individually as a "Party."

RECITALS

WHEREAS, in connection with the prior acquisition of Shenyang Enshi

Pharmaceutical Co., Ltd. ("Enshi") by RACP Pharmaceutical Holdings Ltd.

("RACP"), which was set up by RimAsia for the sole purpose to acquire Enshi,

RimAsia extended a loan in the aggregate principal amount of US$11.5 million to

RACP (the "Loan") for the purpose of the acquisition of Enshi, pursuant to the

terms and conditions of that certain Facility Agreement dated May 29, 2006 (the

"Loan Agreement").

WHEREAS, CBH acquired RACP from RimAsia pursuant to a Stock Purchase Agreement

and a Conditional Stock Purchase Agreement dated May 29, 2006 and a Deed of

Accession dated June 30, 2006 (the "Deed of Accession"), and thereby RACP became

a wholly-owned subsidiary of CBH and the Loan was assumed by CBH in June 2006.

WHEREAS, the Loan is currently in default under the terms of the Loan Agreement,

with a total amount due and payable on October 15, 2007 of approximately

US$12,508,534 comprising of (i) a principal amount of US$11,500,000, (ii) unpaid

interest (up to October 15, 2007) of US$1,008,534 (the "Balance Outstanding").

WHEREAS, RimAsia and CBH have entered into a definitive letter of intent and a

term sheet to restructure the Loan where RimAsia has agreed to convert the Loan

into newly issued Preferred Shares, subject to the changes and modifications in

this Agreement. The conversion of the Loan and the Balance Outstanding into the

Preferred Shares pursuant to this Agreement and the other Transaction Documents

is to be referred to herein as the "Conversion."

WHEREAS, pursuant to the provisions of this Agreement, the Parties have agreed

that the Conversion is subject to the condition subsequent of the completion of

one of the three acquisitions planned, which are more fully described in a

separate confidential side letter between the Parties due to the confidential

nature of these possible acquisitions.

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THEREFORE, in consideration of the premises, agreements, covenants,

representations and warranties contained in this Agreement, and other good and

valuable consideration, the sufficiency and receipt of which are hereby

acknowledged, the Parties hereby agree as follows:

1. CERTAIN DEFINITIONS. For purposes of this Agreement, the following terms have

the respective indicated meanings below:

1.1. "Action" has the meaning ascribed to such term in Section 3.1.10.

1.2. "Additional Warrant" means the warrant to be issued to RimAsia under

this Agreement with its terms set forth in the Form of Additional Common Stock

Purchase Warrant attached hereto as Exhibit C.

1.3. "Affiliate" means any Person that, directly or indirectly through one

or more intermediaries, controls or is controlled by or is under common control

with a Person, as such terms are used in and construed under Rule 144 under the

Securities Act. With respect to RimAsia, any investment fund or managed account

that is managed on a discretionary basis by the same investment manager as

RimAsia will be deemed to be an Affiliate of RimAsia. For purposes of the

Transaction Documents, RimAsia shall not be deemed an "Affiliate" of CBH or

Erye.

1.4. "Balance Outstanding" has the meaning ascribed to such term in the

Recitals of this Agreement.

1.5. "Closing" means the closing of the Conversion and issuance of the

Securities pursuant to Section 2.1.

1.6. "Closing Date" means the Trading Day when all of the Transaction

Documents have been executed and delivered by the applicable parties thereto,

and all conditions precedent to (i) RimAsia's obligations to convert the Loan

and (ii) CBH's obligations to deliver the Securities have been satisfied or

waived.

1.7. "Commission" means the United States Securities and Exchange

Commission.

1.8. "Common Stock" means the common stock of CBH, par value $.001 per

share, and any other class of securities into which such common stock may

hereafter have been reclassified or changed into.

1.9. "Common Stock Equivalents" means any securities of CBH or the

Subsidiaries which would entitle the holder thereof to acquire at any time

Common Stock, including, without limitation, any debt, preferred stock, rights,

options, warrants or other instrument that is at any time convertible into or

exercisable or exchangeable for, or otherwise entitles the holder thereof to

receive, Common Stock or other securities that entitle the holder to receive,

directly or indirectly, Common Stock.

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1.10. "Company Counsel" means Baker & McKenzie, LLP.

1.11. "Conversion Shares" means the shares of Common Stock issuable upon

conversion of the Preferred Shares.

1.12. "Effectiveness Date" means the date on which the initial

Registration Statement filed by CBH pursuant to the Registration Rights

Agreement is first declared effectively by the Commission.

1.13. "Erye" means Suzhou Erye Pharmaceutical Company Ltd.

1.14. "Exchange Act" means the Securities Exchange Act of 1934, as

amended, and the rules and regulations promulgated thereunder.

1.15. "GAAP" has the meaning ascribed to such term in Section 3.1.8.

1.16. "Knowledge" means, with respect to any statement made to the

knowledge of a party, that the statement is based upon actual knowledge of the

officers of such party having responsibility for the matter or matters that are

the subject of the statement, after due inquiry.

1.17. "Lien" means a lien, charge, security interest, encumbrance, right

of first refusal, preemptive right or other restriction.

1.18. "Litigation Agreement" means the agreement between CBH and RimAsia,

dated the date hereof, concerning certain litigation matters, substantially in

the form of Exhibit F attached hereto.

1.19. "Loan" has the meaning ascribed to such term in the Recitals of this

Agreement.

1.20. "Material Adverse Effect" has the meaning assigned to such term in

Section 3.1.2.

1.21. "Modified Warrant" means the warrant which was previously issued to

RimAsia exercisable into 12,000,000 shares of the Common Stock (such previously

issued warrant, the "Original Warrant") and is being modified to reduce the

per-share exercise price and to extend the exercise period to 4.5 years from the

Closing Date, all as set forth in the Form of Amended Common Stock Purchase

Warrant attached hereto as Exhibit B.

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1.22. "Legend Removal Date" has the meaning ascribed to such term in

Section 4.1.3.

1.23. "Person" means an individual or corporation, partnership, trust,

incorporated or unincorporated association, joint venture, limited liability

company, joint stock company, government (or an agency or subdivision thereof)

or other entity of any kind.

1.24. "Original Warrant" has the meaning ascribed to it in Section 1.21.

1.25. "Preferred Shares" means 6,185,607 shares of Series B Senior

Convertible Redeemable Preferred Stock of CBH.

1.26. "Proceeding" means an action, claim, suit, investigation or

proceeding (including, without limitation, an investigation or partial

proceeding, such as a deposition), whether commenced or threatened.

1.27. "Registration Rights Agreement" means the Registration Rights

Agreement, dated the date hereof, among between CBH and RimAsia, in the form of

Exhibit E attached hereto.

1.28. "Registration Statement" means a registration statement meeting the

requirements set forth in the Registration Rights Agreement and covering the

resale of the Conversion Shares and Warrant Shares by RimAsia as provided for in

the Registration Rights Agreement.

1.29. "Required Approvals" has the meaning ascribed to such term in

Section 3.1.5.

1.30. "Rule 144" means Rule 144 promulgated by the Commission pursuant to

the Securities Act, as such Rule may be amended from time to time, or any

similar rule or regulation hereafter adopted by the Commission having

substantially the same effect as such Rule.

1.31. "SEC Reports" has the meaning ascribed to such term in Section

3.1.8.

1.32. "Securities" means the Preferred Shares, the Modified Warrant and

the Additional Warrant.

1.33. "Securities Act" means the Securities Act of 1933, as amended, and

the rules and regulations promulgated thereunder.

1.34. "Short Sales" means all "short sales" as defined in Rule 200 of

Regulation SHO under the Exchange Act (but shall not be deemed to include the

location and/or reservation of borrowable shares of Common Stock).

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1.35. "Subsidiary" means any subsidiary of CBH as disclosed in the SEC

Reports.

1.36. "Trading Day" means a day on which the Common Stock is traded on a

Trading Market.

1.37. "Trading Market" means the following markets or exchanges on which

the Common Stock is listed or quoted for trading on the date in question: the

NASDAQ Capital Market, the American Stock Exchange, the New York Stock Exchange,

the NASDAQ National Market or the OTC Bulletin Board.

1.38. "Transaction Document" means (a) this Agreement, (b) the Modified

Warrant, (c) the Additional Warrant, (d) CBH's Certificate of Designation of

Series B Convertible Redeemable Preferred Stock attached hereto as Exhibit A,

(e) the Registration Rights Agreement, (f) the Litigation Agreement, (g) Service

Agreement regarding Enshi (the "Service Agreement"); (h) Assignment of Claims by

CBH in favor of RACP (the "Damage Assignment"); and (i) any other documents or

agreements executed in connection with the transactions contemplated hereunder.

1.39. "VWAP" means, for any date, the price determined by the first of the

following clauses that applies: (a) if the Common Stock is then listed or quoted

on a Trading Market, the daily volume weighted average price of the Common Stock

for such date (or the nearest preceding date) on the Trading Market on which the

Common Stock is then listed or quoted as reported by Bloomberg Financial L.P.

(based on a Trading Day from 9:30 a.m. Eastern Time to 4:02 p.m. Eastern Time);

(b) if the Common Stock is not then listed or quoted on a Trading Market and if

prices for the Common Stock are then reported in the "Pink Sheets" published by

the Pink Sheets, LLC (or a similar organization or agency succeeding to its

functions of reporting prices), the most recent bid price per share of the

Common Stock so reported; or (c) in all other cases, the fair market value of a

share of Common Stock as determined by an independent appraiser selected in good

faith by RimAsia and reasonably acceptable to CBH.

1.40. "Warrants" means the Modified Warrant and Additional Warrant.

1.41. "Warrant Shares" means shares of the Common Stock issuable upon

exercise of the Modified Warrant or Additional Warrant.

2. CONVERSION AND ISSUANCE OF SECURITIES

2.1. Closing. On the Closing Date, upon the terms and subject to the

conditions set forth herein, concurrent with the execution and delivery of this

Agreement by the parties hereto, RimAsia agrees to convert Twelve Million Four

Hundred Ninety Four Thousand Six Hundred Seventy One United States Dollars

(US$12,508,534 ), representing the total principal amount of the Loan and the

unpaid interest (up to October 15, 2007) of US$1,008,534 (the "Loan Conversion

Amount") and the warrant to

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purchase 12,000,000 shares of Common Stock, into 6,185,607 Preferred Shares,

with a conversion price of US$2.0222 per Preferred Share, and CBH agrees to

issue to RimAsia (a) the Preferred Shares, (b) the Modified Warrant to purchase

12,000,000 shares of CBH's Common Stock with a new exercise price of $1.26 per

share and with a new term of four and a half years from the Closing Date, and

(c) the Additional Warrant exercisable into such a number of shares of CBH's

Common Stock and at such an exercise price to be determined according to the

terms of such Additional Warrants, with a term of four years from the date of

issuance. The voting powers, designations, preferences, rights and

qualifications, limitations or restrictions of the Series B Preferred Stock are

all as set forth in the Certificate of Designation of Series B Convertible

Redeemable Preferred Stock attached hereto as Exhibit A (the "Series B

Certificate of Designation"). The terms and conditions of the Modified Warrants

are set forth in the Form of Amended Common Stock Purchase Warrant attached

hereto as Exhibit B. The terms and conditions of the Additional Warrant are set

forth in the Form of Additional Common Stock Purchase Warrant attached hereto as

Exhibit C.

2.2. Deliveries.

2.2.1. On the Closing Date, CBH shall deliver or cause to be

delivered to RimAsia the following:

2.2.1.1. this Agreement duly executed by CBH;

2.2.1.2. a certificate evidencing the Preferred Shares;

2.2.1.3. the Modified Warrant registered in the name of

RimAsia;

2.2.1.4. the Additional Warrant registered in the name of

RimAsia;

2.2.1.5. the legal opinion of Company Counsel, in

substantially the form attached hereto as Exhibit D, addressed to RimAsia;

2.2.1.6. the Registration Rights Agreement, duly executed by

CBH;

2.2.1.7. the Litigation Agreement, duly executed by CBH;

2.2.1.8. the Service Agreement, duly executed by CBH; and

2.2.1.9. the Damage Assignment, duly executed by CBH.

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2.2.2. On the Closing Date, RimAsia shall deliver or cause to be

delivered to CBH the following:

2.2.2.1. this Agreement duly executed by RimAsia;

2.2.2.2. the Litigation Agreement, duly executed by RimAsia;

2.2.2.3. the Service Agreement executed by RimAsia;

2.2.2.4. the Registration Rights Agreement, duly executed by

RimAsia; and

2.2.2.5. The Original Warrant dated June 30, 2006 to purchase

12,000,000 shares of Common Stock.

2.3. Closing Conditions.

2.3.1. The obligations of CBH hereunder in connection with the

Closing are subject to the following conditions precedent being met by the

Closing Date, unless otherwise waived by CBH:

2.3.1.1. the accuracy in all material respects when made and

on the Closing Date of the representations and warranties of RimAsia contained

herein;

2.3.1.2. all obligations, covenants and agreements of RimAsia

required to be performed at or prior to the Closing Date shall have been

performed; and

2.3.1.3. the delivery by RimAsia of the items set forth in

Section 2.2.2 of this Agreement.

2.3.2. The obligations of RimAsia hereunder in connection with

the Closing are subject to the following conditions precedent being met by the

Closing Date, unless otherwise waived by RimAsia:

2.3.2.1. the accuracy in all material respects on the Closing

Date of the representations and warranties of CBH contained herein;

2.3.2.2. all obligations, covenants and agreements of CBH

required to be performed at or prior to the Closing Date shall have been

performed;

2.3.2.3. the delivery by CBH of the items set forth in Section

2.2.1 of this Agreement;

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2.3.2.4. since the date of execution of this Agreement, no

event or series of events shall have occurred that reasonably could have or

result in (i) an adverse effect on the legality, validity or enforceability of

any Transaction Document, or (ii) a Material Adverse Effect;

2.3.2.5. no statute, rule, regulation, executive order,

decree, ruling or injunction shall have been enacted, entered, promulgated or

endorsed by any court or governmental authority of competent jurisdiction that

prohibits the consummation of any of the transactions contemplated by the

Transaction Documents; and

from the date hereof to the Closing Date, trading in the

Common Stock shall not have been suspended by the Commission or CBH's principal

Trading Market (except for any suspension of trading of limited duration agreed

to by CBH, which suspension shall be terminated prior to the Closing), and, at

any time prior to the Closing Date, trading in securities generally as reported

by Bloomberg Financial Markets shall not have been suspended or limited, or

minimum prices shall not have been established on securities whose trades are

reported by such service, or on any Trading Market, nor shall a banking

moratorium have been declared either by the United States or New York State

authorities nor shall there have occurred any material outbreak or escalation of

hostilities or other national or international calamity of such magnitude in its

effect on, or any material adverse change in, any financial market which, in

each case, in the reasonable judgment of RimAsia, makes it impracticable or

inadvisable to convert the Loan at the Closin

2.3.3. Notwithstanding anything in this Agreement or any other

Transaction Document to the contrary, the Conversion contemplated by this

Agreement is subject to the conditions subsequent of (i) the execution of an

Acquisition LOI, as such term is defined in a side letter between the Parties

dated as of even date herewith (the "Side Letter"), by January 15, 2008 (the

"First Condition Subsequent Cutoff Date"), and, (ii) if an Acquisition LOI has

been executed by the First Condition Subsequent Cutoff Date, the actual closing,

by no later than June 30, 2008 (the "Second Condition Subsequent Cutoff Date";

each of the First Condition Subsequent Cutoff Date and the Second Condition

Subsequent Cutoff Date, a "Condition Subsequent Cutoff Date"), of the

Acquisition (as such term is defined in the Side Letter) which was the subject

of the Acquisition LOI. If no Acquisition LOI has been executed by the First

Condition Subsequent Cutoff Date or, following the execution of an Acquisition

LOI by the First Condition Subsequent Cutoff Date, the closing of the

Acquisition has not occurred by the Second Condition Subsequent Cutoff Date,

RimAsia shall have the option to unwind the Conversion within 60 days following

the relevant Condition Subsequent Cutoff Date by serving a written notice to CBH

(the "Re-Conversion Notice"). Upon the delivery of the Re-Conversion Notice, (a)

the Preferred Shares shall automatically, and without further action, be

converted back to (via a conversion, exchange, a repurchase by CBH in

consideration of the Loan and the Outstanding Balance and the revival of the

Loan Agreement and the Loan Assumption Agreement, or any other lawful means)

(the "Re-

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Conversion") the Loan and the Outstanding Balance, (b) all the terms and

conditions of the Loan Agreement and the Loan Assumption Agreement (including,

without limitation, interest accrual and RimAsia's right of acceleration) shall

be deemed revived as if the Conversion had never occurred, (c) the Modified

Warrant shall be deemed reverted back to the Original Warrant, and (d) the

Additional Warrant shall be deemed cancelled. For purposes of clarification, the

Litigation Agreement, the Service Agreement and the Claim Assignment shall

survive the Re-Conversion Notice. In furtherance of the foregoing, CBH hereby

represents and covenants that, at all times prior to the occurrence of the above

described condition subsequent, the Preferred Shares will always be treated as

debt and will not be treated as capital on its books. CBH hereby represents and

warrants to RimAsia that nothing in (i) the Delaware General Corporation Law,

CBH's Certificate of Incorporation or bylaws, or any agreement or understanding

between CBH and any third party or (ii) CBH's financial condition, will prohibit

the Re-Conversion as contemplated by this section.

3. REPRESENTATIONS AND WARRANTIES

3.1. Representations and Warranties of CBH. CBH hereby makes the

representations and warranties as of the date hereof and as of the Closing Date

set forth below to RimAsia.

3.1.1. Subsidiaries. All of the direct and indirect subsidiaries of

CBH have been disclosed in the SEC Reports. CBH owns, directly or indirectly,

all of the capital stock or other equity interests of each Subsidiary free and

clear of any Liens, and all the issued and outstanding shares of capital stock

of each Subsidiary are validly issued and are fully paid, non-assessable and

free of preemptive and similar rights to subscribe for or purchase securities.

3.1.2. Organization and Qualification. Each of CBH and its

Subsidiaries is an entity duly incorporated or otherwise organized, validly

existing and in good standing under the laws of the jurisdiction of its

incorporation or organization (as applicable), with the requisite power and

authority to own and use its properties and assets and to carry on its business

as currently conducted. Neither CBH nor any Subsidiary is in violation of, or

default under, any of the provisions of its respective certificate or articles

of incorporation, bylaws or other organizational or charter documents. Each of

CBH and the Subsidiaries is duly qualified to conduct business and is in good

standing as a foreign corporation or other entity in each jurisdiction in which

the nature of the business conducted or property owned by it makes such

qualification necessary, except where the failure to be so qualified or in good

standing, as the case may be, could not, individually, or in the aggregate, have

or reasonably be expected to result in (i) a material adverse effect on the

legality, validity or enforceability of any Transaction Document, (ii) a

material adverse effect on the results of operations, assets, business,

prospects or condition (financial or otherwise) of CBH and the Subsidiaries,

taken as a whole, or (iii) a material adverse effect on CBH's ability to perform

in any material respect on a timely basis its obligations under any Transaction

Document (any of

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(i), (ii) or (iii), a "Material Adverse Effect") and no Proceeding has been

instituted in any such jurisdiction revoking, limiting or curtailing or seeking

to revoke, limit or curtail such power and authority or qualification.

3.1.3. Authorization; Enforcement. CBH has the requisite corporate

power and authority to enter into and to consummate the transactions

contemplated by each of the Transaction Documents and otherwise to carry out its

obligations hereunder and thereunder. The execution and delivery of each of the

Transaction Documents by CBH and the consummation by it of the transactions

contemplated thereby have been duly authorized by all necessary action on the

part of CBH and no further action is required by CBH, its board of directors or

its stockholders in connection therewith other than in connection with the

Required Approvals. Each Transaction Document has been (or upon delivery will

have been) duly executed by CBH and, when delivered in accordance with the terms

hereof and thereof, will constitute the valid and binding obligation of CBH

enforceable against CBH in accordance with its terms except (i) as limited by

applicable bankruptcy, insolvency, reorganization, moratorium and other laws of

general application affecting enforcement of creditors' rights generally, (ii)

as limited by laws relating to the availability of specific performance,

injunctive relief or other equitable remedies and (iii) in so far as

indemnification and contribution provisions may be limited by applicable law.

3.1.4. No Conflicts. The execution, delivery and performance of the

Transaction Documents by CBH and the consummation by CBH of the other

transactions contemplated hereby and thereby do not and will not: (i) conflict

with or violate any provision of CBH's or any Subsidiary's certificate or

articles of incorporation, bylaws or other organizational or charter documents,

or (ii) conflict with, or constitute a default (or an event that with notice or

lapse of time or both would become a default) under, result in the creation of

any Lien upon any of the properties or assets of CBH or any Subsidiary, or give

to others any rights of termination, amendment, acceleration or cancellation

(with or without notice, lapse of time or both) of, any agreement, credit

facility, debt or other instrument (evidencing a Company or Subsidiary debt or

otherwise) or other understanding to which CBH or any Subsidiary is a party or

by which any property or asset of CBH or any Subsidiary is bound or affected, or

(iii) subject to the Required Approvals, conflict with or result in a violation

of any law, rule, regulation, order, judgment, injunction, decree or other

restriction of any court or governmental authority to which CBH or a Subsidiary

is subject (including federal and state securities laws and regulations), or by

which any property or asset of CBH or a Subsidiary is bound or affected; except

in the case of each of clauses (ii) and (iii), such as could not, individually,

or in the aggregate, have or reasonably be expected to result in a Material

Adverse Effect.

3.1.5. Filings, Consents and Approvals. CBH is not required to

obtain any consent, waiver, authorization or order of, give any notice to, or

make any filing or registration with, any court or other federal, state, local

or other governmental authority or other Person in connection with the

execution, delivery and performance by CBH of the Transaction Documents, other

than (i) filings required pursuant to Section 4.6, (ii) the

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filing with the Commission of one or more Registration Statements in accordance

with the requirements of the Registration Rights Agreement, (iii) filings

required by state securities laws in accordance with the requirements of the

Registration Rights Agreement, which when permitted, will be made prior to the

Effectiveness Date (as such term is defined in the Registration Rights

Agreement), (iv) the notice and/or application(s) to each applicable Trading

Market for the issuance and sale of the Registrable Securities (as such term is

defined in the Registration Rights Agreement) and the listing of the Registrable

Securities for trading thereon in the time and manner required thereby, (v) the

filing of Form D with the Commission and such filings as are required to be made

under applicable state securities laws and (vi) the filing of the certificate of

designation for the Preferred Shares with the Secretary of the State of Delaware

(collectively, the "Required Approvals").

3.1.6. Issuance of the Securities. The Securities are duly

authorized and, when issued and paid for (or converted into) in accordance with

the applicable Transaction Documents, will be duly and validly issued, fully

paid and non-assessable, free and clear of all Liens other than restrictions on

transfer provided for in the Transaction Documents. The Conversion Shares and

the Warrant Shares, when issued in accordance with the terms of the Transaction

Documents, will be validly issued, fully paid and non-assessable, free and clear

of all Liens, other than the restrictions on transfer provided for in the

Transaction Documents. CBH has reserved from its duly authorized capital stock

the number of shares of Common Stock issuable pursuant to the Series B

Certificate of Designation, the Modified Warrant and the Additional Warrants in

order to issue the Conversion Shares and the Warrant Shares. The Securities are

not subject to any preemptive or similar rights to subscribe for or purchase

securities.

3.1.7. Capitalization. Other than disclosed in the SEC Reports, CBH

has not issued any capital stock other than pursuant to the conversion or

exercise of outstanding Common Stock Equivalents. Other than disclosed in the

SEC Reports, as of the date of this Agreement, except for the Preferred Shares,

there is no share of any preferred stock of CBH outstanding. No securities of

CBH are entitled to preemptive or similar rights and no Person has any right of

first refusal, preemptive right, right of participation, or any similar right to

participate in the transactions contemplated by the Transaction Documents. As of

the date of this Agreement, except as disclosed in the SEC Reports and as a

result of the issuance of the Securities, there are no outstanding options,

warrants, script rights to subscribe to, calls or commitments of any character

whatsoever relating to, or securities, rights or obligations convertible into or

exercisable or exchangeable for, or giving any Person any right to subscribe for

or acquire, any shares of the capital stock of CBH, or contracts, commitments,

understandings or arrangements by which CBH or any Subsidiary is or may become

bound to issue additional shares of its capital stock, or securities or rights

convertible or exchangeable into shares of Common Stock. The issuance and sale

of the Securities will not obligate CBH to issue shares of Common Stock or other

securities to any Person (other than RimAsia) and will not result in a right of

any holder of CBH securities to adjust the

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exercise, conversion, exchange or reset price under such securities. All of the

outstanding shares of capital stock of CBH are validly issued, fully paid and

non-assessable, have been issued in compliance with all federal and state

securities laws, and none of such outstanding shares was issued in violation of

any preemptive rights or similar rights to subscribe for or purchase securities.

No further approval or authorization of any stockholder, the Board of Directors

of CBH or others is required for the issuance and sale of the Securities, the

Conversion Shares or the Warrant Shares. There are no stockholders agreements,

voting agreements or other similar agreements with respect to CBH's capital

stock to which CBH is a party or, to the Knowledge of CBH, between or among any

of CBH's stockholders.

3.1.8. SEC Reports; Financial Statements. CBH has filed all reports,

schedules, forms, statements and other documents required to be filed by it

under the Securities Act and the Exchange Act, including pursuant to Section

13(a) or 15(d) thereof, for the two years preceding the date hereof (or such

shorter period as CBH was required by law to file such material) (the foregoing

materials, including the exhibits thereto and documents incorporated by

reference therein, being collectively referred to herein as the "SEC Reports")

on a timely basis or has received a valid extension of such time of filing and

has filed any such SEC Reports prior to the expiration of any such extension. As

of their respective dates, other than the SEC Reports relating to Enshi, which

may be subject to further amendment pursuant to new investigation and

discoveries, the SEC Reports complied in all material respects with the

requirements of the Securities Act and the Exchange Act, and none of the SEC

Reports, when filed, contained any untrue statement of a material fact or

omitted to state a material fact required to be stated therein or necessary in

order to make the statements therein, in the light of the circumstances under

which they were made, not misleading. The financial statements of CBH included

in the SEC Reports comply in all material respects with applicable accounting

requirements and the rules and regulations of the Commission with respect

thereto as in effect at the time of filing. Such financial statements have been

prepared in accordance with United States generally accepted accounting

principles applied on a consistent basis during the periods involved ("GAAP"),

except as may be otherwise specified in such financial statements or the notes

thereto, and fairly present in all material respects the financial position of

CBH and its consolidated Subsidiaries as of and for the dates thereof and the

results of operations and cash flows for the periods then ended, subject, in the

case of unaudited statements, to normal, immaterial, year-end audit adjustments.

CBH maintains and will continue to maintain a standard system of accounting

established and administered in accordance with GAAP and the applicable

requirements of the Exchange Act.

3.1.9. Material Changes. Since the date of the latest audited

financial statements included within the SEC Reports, except as specifically

disclosed in the SEC Reports or certain litigation events previously disclosed

to RimAsia, (i) there has been no event, occurrence or development that has had

or that, individually, or in the aggregate, could reasonably be expected to

result in a Material Adverse Effect, (ii) CBH has not incurred any liabilities

(contingent or otherwise) other than (A) trade payables and accrued expenses

incurred in the ordinary course of business consistent with past practice,

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(B) liabilities not required to be reflected in CBH's financial statements

pursuant to GAAP or required to be disclosed in filings made with the

Commission, and (C) other liabilities that would not, individually or in the

aggregate, have a Material Adverse Effect, (iii) CBH has not altered its method

of accounting or the identity of its auditors, (iv) CBH has not declared or made

any dividend or distribution of cash or other property to its stockholders or

purchased, redeemed or made any agreements to purchase or redeem any shares of

its capital stock and (v) CBH has not issued any equity securities to any

officer, director or Affiliate, except pursuant to existing Company stock option

plans. As of the date of this Agreement, CBH does not have pending before the

Commission any request for confidential treatment of information.

3.1.10. Litigation. Except as disclosed in the SEC Reports or

previously disclosed to RimAsia, there is no action, suit, inquiry, notice of

violation, proceeding or investigation pending or, to the Knowledge of CBH,

threatened against or affecting CBH, any Subsidiary or any of their respective

properties before or by any court, arbitrator, governmental or administrative

agency or regulatory authority (federal, state, county, local or foreign) (each,

an "Action") which , could, if there were an unfavorable decision, individually,

or in the aggregate, have or reasonably be expected to result in a Material

Adverse Effect. Neither CBH nor any Subsidiary, nor any director or officer

thereof, is or has been the subject of any Action involving a claim of violation

of or liability under federal or state securities laws or a claim of breach of

fiduciary duty. There has not been, and to the Knowledge of CBH, there is not

pending or contemplated, any investigation by the Commission involving CBH or

any current or former director or officer of CBH. The Commission has not issued

any stop order or other order suspending the effectiveness of any registration

statement filed by CBH or any Subsidiary under the Exchange Act or the

Securities Act. No executive officer, to the Knowledge of CBH, is, or is now

expected to be, in violation of any material term of any employment contract,

confidentiality, disclosure or proprietary information agreement or

non-competition agreement, or any other contract or agreement or any restrictive

covenant, and the continued employment of each such executive officer does not

subject CBH or any of its Subsidiaries to any liability with respect to any of

the foregoing matters. CBH and its Subsidiaries are in compliance with all

applicable laws and regulations relating to employment and employment practices,

terms and conditions of employment and wages and hours, except where the failure

to be in compliance could not, individually or in the aggregate, reasonably be

expected to have a Material Adverse Effect.

3.1.11. Labor Relations. Neither CBH nor any of its Subsidiaries is

a party to a collective bargaining agreement, and CBH and its Subsidiaries

believe that their relationships with their employees are good. No material

labor dispute exists or, to the Knowledge of CBH, is imminent with respect to

any of the employees of CBH which could reasonably be expected to result in a

Material Adverse Effect.

3.1.12. Compliance. Except as disclosed in the SEC Reports or

previously disclosed to RimAsia in connection with certain litigation events,

neither CBH nor any Subsidiary (i) is in default under or in violation of (and

no event has occurred

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that has not been waived that, with notice or lapse of time or both, would

result in a default by CBH or any Subsidiary under), nor has CBH or any

Subsidiary received notice of a claim that it is in default under or that it is

in violation of, any indenture, loan or credit agreement or any other agreement

or instrument to which it is a party or by which it or any of its properties is

bound (whether or not such default or violation has been waived), (ii) is in

violation of any order of any court, arbitrator or governmental body, or (iii)

is or has been in violation of any statute, rule or regulation of any

governmental authority, including without limitation all foreign, federal, state

and local laws applicable to its business and all such laws that affect the

environment, except in each case as could not, individually, or in the

aggregate, have a Material Adverse Effect. CBH is in compliance with all

effective requirements of the Sarbanes-Oxley Act of 2002, as amended, and the

rules and regulations thereunder, that are applicable to it, except where such

noncompliance, individually or in the aggregate, could not have or reasonably be

expected to result in a Material Adverse Effect.

3.1.13. Regulatory Permits. Except as disclosed in the SEC Reports,

CBH and the Subsidiaries possess all certificates, authorizations and permits

issued by the appropriate federal, state, local or foreign regulatory

authorities necessary to conduct their respective businesses as described in the

SEC Reports, except where the failure to possess such permits could not,

individually, or in the aggregate, have or reasonably be expected to result in a

Material Adverse Effect ("Material Permits"), and neither CBH nor any Subsidiary

has received any notice of proceedings relating to the revocation or

modification of any Material Permit.

3.1.14. Title to Assets. CBH and the Subsidiaries have good and

marketable land use rights with respect to all real property owned by them that

is material to the business of CBH and the Subsidiaries and good and marketable

title in all personal property owned by them that is material to the business of

CBH and the Subsidiaries, in each case free and clear of all Liens, except for

Liens as do not materially affect the value of such property and do not

materially interfere with the use made and proposed to be made of such property

by CBH and the Subsidiaries. Any real property and facilities held under lease

by CBH and the Subsidiaries are held by them under valid, subsisting and

enforceable leases of which CBH and the Subsidiaries are in compliance.

3.1.15. Patents and Trademarks. CBH and the Subsidiaries have, or

have rights to use, all patents, patent applications, trademarks, trademark

applications, service marks, trade names, trade secrets, inventions, copyrights,

licenses and other intellectual property rights or similar rights necessary or

material for use in connection with their respective businesses as described in

the SEC Reports and which the failure to so have could, individually, or in the

aggregate, have or reasonably be expected to have a Material Adverse Effect

(collectively, the "Intellectual Property Rights"). Neither CBH nor any

Subsidiary has received a notice (written or otherwise) that the Intellectual

Property Rights used by CBH or any Subsidiary violates or infringes upon the

rights of any Person. All such Intellectual Property Rights are enforceable and

do not violate or infringe the Intellectual Property Rights of others in any

respect that would, individually

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or in the aggregate, reasonably be expected to result in a Material Adverse

Effect and, to the Knowledge of CBH, there is no existing infringement by

another Person of any of CBH's or the Subsidiary's Intellectual Property Rights.

CBH and its Subsidiaries have taken reasonable security measures to protect the

secrecy, confidentiality and value of all of their intellectual properties,

except where failure to do so could not, individually or in the aggregate,

reasonably be expected to have a Material Adverse Effect.

3.1.16. Insurance. CBH and the Subsidiaries are insured by insurers

of recognized financial responsibility against such losses and risks and in such

amounts as are prudent and customary in the businesses in which CBH and the

Subsidiaries are engaged, including, but not limited to, directors and officers

insurance coverage at least equal to the aggregate Loan Conversion Amount. To

the best Knowledge of CBH, such insurance contracts and policies are accurate

and complete. Neither CBH nor any Subsidiary has any reason to believe that it

will not be able to renew its existing insurance coverage as and when such

coverage expires or to obtain similar coverage from similar insurers as may be

necessary to continue its business without a significant increase in cost.

3.1.17. Transactions with Affiliates and Employees. Except as set

forth in the SEC Reports, none of the officers or directors of CBH and, to the

Knowledge of CBH, none of the employees of CBH is presently a party to any

transaction with CBH or any Subsidiary (other than for services as employees,

officers and directors), including any contract, agreement or other arrangement

providing for the furnishing of services to or by, providing for rental of real

or personal property to or from, or otherwise requiring payments to or from any

officer, director or such employee or, to the Knowledge of CBH, any entity in

which any officer, director, or any such employee has a substantial interest or

is an officer, director, trustee or partner.

3.1.18. Sarbanes-Oxley; Internal Accounting Controls. CBH is in

compliance with all provisions of the Sarbanes-Oxley Act of 2002 which are

applicable to it as of the Closing Date.

3.1.19. Private Placement. Assuming the accuracy of RimAsia's

representations and warranties set forth in Section 3.2, no registration under

the Securities Act is required for the offer and sale of the Securities by CBH

to RimAsia as contemplated hereby. The issuance and sale of the Securities

hereunder does not contravene the rules and regulations of the Trading Market.

Except as described in the SEC Reports, CBH has not granted or agreed to grant

to any Person any rights (including "piggy-back" registration rights) to have

any securities of CBH registered with the Commission or any other governmental

authority that have not been satisfied.

3.1.20. Investment Company. CBH is not, and is not an Affiliate of,

and immediately after issuance of the Securities, will not be or be an Affiliate

of, an "investment company" within the meaning of the Investment Company Act of

1940, as amended. CBH shall conduct its business in a manner so that it will not

become subject to the Investment Company Act.

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3.1.21. Registration Rights. RimAsia has the right to cause CBH to

effect the registration under the Securities Act pursuant to the Registration

Rights Agreement.

3.1.22. Listing and Maintenance Requirements. CBH's Common Stock is

registered pursuant to Section 12(g) of the Exchange Act, and CBH has taken no

action designed to, or which to its Knowledge is likely to have the effect of,

terminating the registration of the Common Stock under the Exchange Act nor has

CBH received any notification that the Commission is contemplating terminating

such registration. CBH has not, in the 24 months preceding the date hereof,

received notice from any Trading Market on which the Common Stock is or has been

listed or quoted to the effect that CBH is not in compliance with the listing or

maintenance requirements of such Trading Market. CBH is, and has no reason to

believe that it will not in the foreseeable future continue to be, in compliance

with all such listing and maintenance requirements. The issuance and sale of the

Securities under the Transaction Documents does not contravene the rules and

regulations of the Trading Market on which the Common Stock is currently listed

or quoted, and no approval of the stockholders of CBH thereunder is required for

CBH to issue and deliver to RimAsia the Securities contemplated by the

Transaction Documents. As of the date hereof, CBH's Common Stock is listed on

the OTC Bulletin Board.

3.1.23. No Integrated Public Offering. Neither CBH, nor any of its

Affiliates, nor any Person acting on its or their behalf, has, directly or

indirectly, made any offers or sales of any security or solicited any offers to

buy any security, under circumstances that would cause this offering of the

Securities to be integrated with prior offerings by CBH for purposes of the

Securities Act or any applicable shareholder approval provisions, which would

have made the issuance of the Securities in this offering a public offering

subject to a registration statement, including, without limitation, under the

rules and regulations of any Trading Market on which any of the securities of

CBH are listed or designated.

3.1.24. Solvency. Based on the financial condition of CBH as of the

Closing Date after giving effect to the receipt by CBH of the proceeds from the

sale of the Securities hereunder, (i) CBH's cash and fair saleable value of its

assets in an orderly liquidation exceeds the amount that will be required to be

paid on or in respect of CBH's existing debts and other liabilities (including

known contingent liabilities) as they mature; (ii) CBH's assets do not

constitute unreasonably small capital to carry on its business for the current

fiscal year as now conducted and as proposed to be conducted including its

capital needs taking into account the particular capital requirements of the

business conducted by CBH, and projected capital requirements and capital

availability thereof; and (iii) the current cash flow of CBH, together with the

proceeds CBH would receive, were it to liquidate all of its assets, after taking

into account all anticipated uses of the cash, would be sufficient to pay all

amounts on or in respect of its debt when such amounts are required to be paid.

CBH does not intend to incur debts beyond its ability to pay such debts as they

mature (taking into account the timing and amounts of cash to be

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payable on or in respect of its debt). CBH has no Knowledge of any facts or

circumstances which lead it to believe that it will file for reorganization or

liquidation under the bankruptcy or reorganization laws of any jurisdiction

within one year from the Closing Date.

3.1.25. Tax Status. Except for matters that would not, individually

or in the aggregate, have or reasonably be expected to result in a Material

Adverse Effect, CBH and each Subsidiary has filed all necessary federal, state

and foreign income and franchise tax returns and has paid or accrued all taxes

shown as due thereon, and CBH has no Knowledge of a tax deficiency which has

been asserted or threatened against CBH or any Subsidiary.

3.1.26. No General Solicitation. Neither CBH nor any person acting

on behalf of CBH has offered or sold any of the Securities by any form of

general solicitation or general advertising. CBH has offered the Securities for

sale only to RimAsia.

3.1.27. No Disagreements with Accountants. There are no

disagreements of any kind presently existing, or reasonably anticipated by CBH

to arise, with the accountants formerly or presently employed by CBH with

respect to CBH's financial statements.

3.1.28. Acknowledgment Regarding RimAsia's Receipt of Securities.

CBH acknowledges and agrees that RimAsia is acting solely in the capacity of an

arm's length acquiror of securities with respect to the Transaction Documents

and the transactions contemplated hereby. CBH further acknowledges that RimAsia

is not acting as a financial advisor or fiduciary of CBH (or in any similar

capacity) with respect to this Agreement and the transactions contemplated

hereby and any advice given by RimAsia or any of its representatives or agents

in connection with this Agreement and the transactions contemplated hereby is

merely incidental to RimAsia's acquisition of the Securities. CBH further

represents to RimAsia that CBH's decision to enter into this Agreement has been

based solely on the independent evaluation of the transactions contemplated

hereby by CBH and its representatives.

3.1.29. Certain Fees. RimAsia shall have no obligation with respect

to any fees or with respect to any claims (other than such fees or commissions

owed by RimAsia pursuant to written agreements executed by RimAsia which fees or

commissions shall be the sole responsibility of RimAsia) made by or on behalf of

other Persons for fees of a type contemplated in this Section that may be due in

connection with the transactions contemplated by this Agreement.

3.1.30. No Additional Agreements. CBH does not have any agreement or

understanding with RimAsia with respect to the transactions contemplated by the

Transaction Documents other than as specified in the Transaction Documents.

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3.1.31. Disclosure. All disclosure provided to RimAsia regarding

CBH, its business and the transactions contemplated hereby, including the

Disclosure Schedules to this Agreement, furnished by or on behalf of CBH with

respect to the representations and warranties made herein are true and correct

with respect to such representations and warranties and do not contain any

untrue statement of a material fact or omit to state any material fact necessary

in order to make the statements made therein, in light of the circumstances

under which they were made, not misleading. CBH acknowledges and agrees that

RimAsia makes or has made no representations or warranties with respect to the

transactions contemplated hereby other than those specifically set forth in

Section 3.2 hereof.

3.2. Representations and Warranties of RimAsia. RimAsia hereby represents

and warrants as of the date hereof and as of the Closing Date to CBH as follows:

3.2.1. Organization; Authority. RimAsia is an entity duly organized,

validly existing and in good standing under the laws of the jurisdiction of its

organization with full right, partnership power and authority to enter into and

to consummate the transactions contemplated by the Transaction Documents and

otherwise to carry out its obligations hereunder and thereunder. The execution,

delivery and performance by RimAsia of the transactions contemplated by this

Agreement have been duly authorized by all necessary partnership action on the

part of RimAsia. Each Transaction Document to which it is a party has been duly

executed by RimAsia, and when delivered by RimAsia in accordance with the terms

hereof, will constitute the valid and legally binding obligation of RimAsia,

enforceable against it in accordance with its terms, except (i) as limited by

general equitable principles and applicable bankruptcy, insolvency,

reorganization, moratorium and other laws of general application affecting

enforcement of creditors' rights generally, (ii) as limited by laws relating to

the availability of specific performance, injunctive relief or other equitable

remedies and (iii) insofar as indemnification and contribution provisions may be

limited by applicable law.

3.2.2. Own Account. RimAsia understands that the Securities are

"restricted securities" and have not been registered under the Securities Act or

any applicable state securities law and is acquiring the Securities as principal

for its own account and not wi